Our analysis is based on comparing Banco de Chile SA with the following peers – Itau Corpbanca Sponsored ADR, Banco Bilbao Vizcaya Argentaria, S.A. Sponsored ADR, Banco Santander-Chile Sponsored ADR, Credicorp Ltd., Bank of Montreal, Citigroup Inc, Banco Santander S.A. Sponsored ADR, Banco Latinoamericano de Comercio Exterior, S.A. Class E, Bancolombia S.A. Sponsored ADR Pfd and Banco Macro SA Sponsored ADR Class B (ITCB-US, BBVA-US, BSAC-US, BAP-US, BMO-US, C-US, SAN-US, BLX-US, CIB-US and BMA-US).
Dividend Quality Overview
- Over the last twelve months (prior to December 31, 2016), BCH-US paid a medium quality dividend, which represents a yield of 2.94% at the current price.
- Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 4 were medium quality and 1 was low quality.
- The ending cash balance, with a dividend coverage of 3.17x, provides a substantial cushion in case of a significant reduction of cash flows in the future.
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Over the last twelve months (prior to December 31, 2016), BCH-US paid a medium quality dividend.
The source of the company’s cash to support the dividend paid over the last twelve months is operating cash flow (coverage of 2.33x), investing cash flow (coverage of -2.08x), issuance cash flow (coverage of 0.84x) and twelve-month prior cash (coverage of 3.38x), for a total dividend coverage of 4.17x.
BCH-US‘s issuance cash flow includes outflows from net debt repayment (coverage of -0.88x).
These coverage ratio factors imply that the firm’s net cash inflow from issuance was required (in addition to operating and investment cash) to pay the dividend, which suggests a medium dividend quality.
|Dividend Yield (%)||4.23||5.06||5.89||5.87||4.77||2.94|
|Dividend Payout (%)||51.9||44.52||40.56||45.03||43.09||43.09|
A complete list of metrics and analysis is available on the company page.
Banco de Chile SA engages in the provision of banking services. It operates through the following segments: Retail; Wholesale; Treasury and Money Market Operations; and Subsidiaries. The Retail segment focuses on individuals and small and medium-sized companies and offers checking accounts, credit cards, credit lines, consumer, commercial, and mortgage loans. The Wholesale segment includes corporate clients and large companies where the product offering focuses primarily on commercial loans, checking accounts, liquidity management services, debt instruments,. foreign trade, derivative contracts, and leases. The Treasury and Money Market Operations segment includes revenue associated with managing the bank’s balance sheet and liquidity, including financial instrument and currency trading. The Subsidiaries segment corresponds to companies and corporations controlled by the bank .The company was founded on October 28, 1893 and is headquartered in Santiago, Chile.
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